January 29, 2009, 10:11 am
Toshiba To Post Huge FY ‘09 Loss As Chip Demand Craters
Posted by Eric Savitz
Toshiba (TOSBF.PK) this morning said it expects to lose 280 billion yen, about $3.1 billion, in the March 2009 fiscal year, down from a profit of 127.4 billion yen in the previous year, and below the company’s September forecast for a profit of 70 billion yen.
The largest Japanese chipmaker, Toshiba is cutting some jobs and delaying plant expansion plans.
Toshiba President Atsutoshi Nishida said that a recovery in chip-market demand is not likely until at least October, according to Bloomberg. He said the company’s chip division will lose 290 billion yen for the year, down from a profit of 89 billion yen a year earlier. Toshiba also said it expects its digital products business - which includes TVs, PCs and phones - to lose 20 billion yen for the year. Previously, the company had expected that business to post a profit of 70 billion yen.
Sales for the year are expected to drop 13%, to 6.7 trillion yen, a trillion less than its previous target.
Moody’s today cut its long-term debt rating on Toshiba to Baa1, citing the earning outlook, and is consdering a further downgrade.
Meanwhile, Toshiba said it is delaying plans for a new chip plan in Yokkaichi, in central Japan, until 2010, and indefinitely postponing another factory planned for northern Japan. The company is cutting 4,500 temporary jobs in its chip and LCD businesses, while adding 500 full-time workers.
The company will cut capital spending on its chip business by 60% to less than 100 billion, from a previously projected 230 billion yen.
In trading on the Pink Sheets, Toshiba is down 20 cents, or 4.8%, to $4. |
